Recycled Lead Battery Market Update;Price remaining at high level but a slight drop for Korea

The lead battery prices in Japan remains at high level of 100-103yen/kg, but extremely high prices such as 105yen/kg have not seen in Kanto region.

Compared to Kanto region, prices are always higher in Kansai region including Nagoya, Kyoto and Osaka, than in Kanto, where major primary lead smelters are aggressively purchasing recycled lead battery. A secondary lead smelter in Kansai region says, “Declining price in Kanto region has just held further price up in Kansai region.”

According to the Japanese statistics of foreign trade, export of recycled lead battery for Korea was 6,324t in March down 27.5% from a year earlier. Average export price was 105yen/kg(FOB) in March compared to 92yen/kg(FOB) of a year earlier. The FOB Korea has kept 100yen/kg level since last October.

A Korean major secondary lead smelter commented on this situation, “As lead smelters still continue to compete for their capacities of production in Korea, recycled lead battery, their raw material are always purchased at an inflated price. Continued low price in their products (secondary lead) with high cost of raw materials, all the Korean secondary lead smelters declared losses in their financial results of Q1. Having a small inventory of raw material, they have no control over this situation as generation of recycled lead battery is seasonally less both in Japan and in Korea now.

This smelter with 1,500t/m of secondary lead production had been one of the Korean top 3 secondary lead smelters until 10 years ago. Since the Anicas Metal and DUNSUK INDUSTRIAL increased their amount of recycled lead battery throughput to 6,000t/m twice as much as the previous years, the manufacturer dropped to 4th place.

The smelter takes a cold look at the Korean infinite battle in their capacities of production as “just digging their own grave”. However, there are some erratic people in Korea who invest to manufacturers with less of chance in Korea (most of them knows nothing of the industry). I hear that such investors expand the capability of production to no purpose.

The shipment for Korea has decreased in Kanto region, concretely speaking within the jurisdiction of the Tokyo Customs. It was 971t in March, down 33% from February and a huge drop of 50% from a year earlier. This drop seems to be caused by the revision in the application for export license for Korea for so-called Basel Convention Act where the way of recycling in Korea such as the processing of lead slag etc. came to be strictly checked. And, it also seems to have caused the price drop. For reference, both the Ministry of Economy, Trade and Industry (hereinafter called METI) and the Ministry of Environment say that nothing has changed in the said application for export license. Also, the Trade Licensing Division of the METI says there is no change because the way of waste processing originally should be specified on the contract between exporters and importers. However, it is still difficult for Japanese domestic lead smelters to get recycled lead battery in bulk at less than 100yen/kg even if the export price for Korea is slightly dropping.

Generation of recycled lead battery decreases traditionally and seasonally till mid-June in Japan. It increases with the rising demand for battery replacement after the rainy season. If the export for Korea dropped at that time, it would be clear that the export market has changed, but the actual drop in export is not more than a temporal one.

Also, more shipment for Korea is conducted from local ports in Japan just like in export of aluminum can scraps. All the recycled batteries generated in Hokkaido are said to be exported to Korea. There are differences in ways of thinking between the local authorities encouraging exports and the Japanese government controlling export. Therefore, lead smelters believe that the supply of recycled lead battery keeps tight in the domestic markets unless the export from Hokkaido and Kyushu decreases.

Meanwhile, the prices of bullion (crude lead) are also rising with the increased lead prices in March. The price for export is moving in the same price range with LME lead price, but it is said that the Japanese domestic primary lead smelters are lowering their purchase prices slightly as too much bullion has flown from secondary lead smelters. The Japanese domestic bullion price remains at 205-210yen/kg at the moment.

（IRuniverse Sasaki）

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